The announcement yesterday by Dutch brewer Heineken that it is to acquire Russia's fourth largest brewer Bravo International has gone down well with industry analysts, despite the high price.

The continued growth of the Russian beer market is no doubt the attraction for Heineken, which paid US$400m for Bravo, which sold 2.5m hl of beer and 400,000 hl of cocktail drinks in 2001.

The move follows the acquisition of Voronezh Brewery in Southern Russia by rival brewer BBH.
Despite the price paid by Heineken, the purchase remains a good one as beer continues to grow at the expense of vodka. This growth means that competitive pressures will remain relatively low for Heineken in the country.

The Russian beer market has grown 21% in 2001 on top of a 22% increase in 200 and a 33% leap in 1999. Russians now consume 44 litres of beer per capita.

However this number remains small compared to German and Czech republic counterparts who drink close to 140 and 160 litres per capita respectively, leaving plenty of room for growth in Russia.

Bravo, furthermore, is one of the last small, quality brewers available for acquisition in the country and gives Heineken a foothold in a market other International brewers will now find difficult to enter.